Mandelson warns on WTO failure

Peter Mandelson has shrugged off criticism of his stance in the WTO negotiations, writes Jamie Smythin Brussels

TRADE COMMISSIONER Peter Mandelson has warned EU beef farmers that failure to agree the basis for a world trade deal next week will mean paying a far higher price in the future.

He also said yesterday that he was confident the Government would support him in last-ditch negotiations next week aimed at agreeing a World Trade Organisation (WTO) deal.

"I have every confidence that the Irish Government will stand with the rest behind the commission in our negotiating this hopefully to a successful conclusion," said Mr Mandelson, who has been criticised by successive Irish agriculture ministers over his negotiating tactics and fears he is preparing to sell out farming interests in the talks.

Minister of State for International Trade John McGuinness will meet his EU counterparts and Mr Mandelson today in an effort to overcome simmering tensions over the WTO talks and agree a united EU position.

The Government has aligned itself with a group of EU states with big agricultural interests such as France and Poland that believe Mr Mandelson will undermine EU farmers by slashing tariffs on agricultural imports.

Other EU states, such as Britain and Sweden, support reducing tariffs on imported farm products in return for negotiating access to developing states' markets for EU industrial products and services.

After seven years, the Doha round of the WTO talks has reached a critical stage, with ministerial talks between the EU, US and developing states scheduled to begin in Geneva next week.

Key problems remain such as persuading India and Brazil to open their markets to EU and US products such as cars and a long-standing row over the tariffs that the EU levies on banana producers from Latin America.

Trade experts have warned that if no deal is agreed next week efforts to further liberalise world trade would be delayed by at least a year due to the US presidential election and could unravel altogether.

Mr Mandelson said Irish beef farmers needed to realise that a failure to get the basis for an agreement next week would result in more pain for them in the future.

"There is no question that the longer these talks go on the bigger the price in agriculture that we will be asked to pay. It would be a good idea if we settled now on the basis of the reforms to the Cap (common agricultural policy) that we have already agreed," said Mr Mandelson.

He warned that a deal on import tariff cuts would not get better over time.

Under the latest set of WTO negotiating texts that will be discussed next week by ministers from 30 countries, import tariffs on beef imports from countries such as Brazil would be reduced by about 23 per cent.

This is lower than the 70 per cent cut in most agricultural import tariffs because beef is likely to be labelled a sensitive product by the EU.

But under the current text the union would be obliged to accept a quota of between 290,000-450,000 tonnes of beef at lower tariff rates, depending on the outcome of talks.

The Irish Farmers' Association (IFA) has warned that a WTO deal would cost the Irish farming and agribusiness sectors up to €4 billion per annum and some 100,000 jobs. It is supported by EU farming organisations, which say a deal will cost up to €30 billion.

Mr Mandelson said the Government should not fall into the same trap in the WTO talks as it did with the referendum on the Lisbon Treaty by not looking at the big picture.

"People said, 'Well, we don't want the Lisbon Treaty because we don't want to lose a commissioner'.

"Actually what it means is that instead of considering whether to have a smaller commission in size by 2014 we have the Nice Treaty instead, which would rob the commissioner next year.

"No one explains these things," said Mr Mandelson, who was used by No campaigners as a key reason to oppose ratification of the Lisbon Treaty.

Mr Mandelson repeated his observation yesterday that this was not the first time he had been unfairly blamed for something in his career and probably wouldn't be the last.

Agriculture commissioner Mariann Fischer Boel also warned that any failure to agree a WTO deal would create insecurity in European agriculture.

"No one knows when a new negotiating round will come up and we do not know what the result will be at that stage," she said.

"Will we be able to sell the quality and values of our 2003 [Cap] reform? Will we be able to resell the phasing out of export refunds? I have my doubts."

Boel said the reforms proposed in the beef sector were manageable for Irish farmers and the special treatment proposed by the EU for sensitive products made tariff cuts bearable.